Image used for illustrative purpose.
Investors look at computer screens in front of an electronic board showing stock information at a brokerage house in Shanghai, China, September 7, 2015.

REUTERS/Aly Song

By Shinichi Saoshiro,
Reuters News

TOKYO - Stock markets dipped after a long winning run on Wall Street ended overnight, while the dollar gained momentum on Wednesday as yields on U.S. Treasury debt headed for highs not seen in four years.

Australian stocks were down 0.05 percent and South Korea's KOSPI fell 0.4 percent.

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The Dow and S&P 500 fell on Tuesday to snap a six-session winning streak as a sharp decline in Walmart weighed heavily.

Gains in Amazon and chip stocks helped the Nasdaq hold near the unchanged mark.

U.S. equities pulled back sharply from record highs earlier this month as a steady rise in Treasury yields raised worries that the Federal Reserve could hike interest rates more frequently this year than initially expected.

Treasury yields rose overnight with the benchmark 10-year yield crawling back to near a four-year peak as investors made room for this week's $258 billion deluge of new government debt.

Treasury yields have risen in the wake of increased government borrowing. The U.S. Treasury Department has issued more debt in anticipation of a higher deficit from last year's major tax overhaul and a budget deal that will increase federal spending over the next two years.

The dollar benefited from the higher yields, with its index against a basket of six major currencies rising to a one-week high of 89.802.

The index has bounced 0.7 percent so far this week after slumping 1.5 percent the previous week to a three-year low.

The U.S. currency has been weighed down by a variety of factors this year, including concerns that Washington might pursue a weak dollar strategy and the perceived erosion of its yield advantage as other countries start to scale back easy monetary policy.

Confidence in the dollar has also been shaken by mounting worries over the U.S. budget deficit.

But the greenback managed to find bids once the dust began to settle after last week's tumble.

"We are seeing the dollar being bought back after last week's slide. The steady U.S. economy and the possibility of the Fed accelerating its rate increases will likely keep fuelling the dollar's rebound, particularly against the euro and yen," said Masafumi Yamamoto, chief currency strategist at Mizuho Securities in Tokyo.

The dollar was steady at 107.365 yen after gaining 0.7 percent overnight. The euro was 0.05 percent lower at $1.2331 following losses of 0.55 percent the previous day.

The Australian dollar was flat at $0.7877 and the New Zealand dollar dipped 0.1 percent to $0.7340.

The stronger dollar weighed on commodities, with U.S. crude oil futures slipping 0.25 percent to $61.63 per barrel.

U.S. crude hit a near two-week high the previous day on news of inventory declines at a key storage hub and from expectations that top OPEC producers could extend cooperation beyond 2018.